Something Fishy Coming to Empty Times Square Tower

After months of head-scratching, there’s finally some clarity as to who will occupy Times Square’s new office tower: sharks and lawyers.

It appears likely, as I’m reporting today, that the bottom seven floors of the building will be occupied by a very unusual, vertical aquarium. And much of the rest of the building—some 400,000 square feet—could go to law firm Proskauer Rose LLP, as the New York Post recently reported.

New York real-estate watchers have long been chattering about the $1.1 billion, 40-story tower known as 11 Times Square because it’s a speculative development being completed in the worst office-property market since the early 1990s. Developer Steven Pozycki broke ground on the site in 2007 without first securing a tenant, and he has yet to announce one. Crain’s New York Business has called 11 Times Square a “real estate bellwether.” The Real Deal called it “a vertical ghost town.”

Outside New York, 11 Times Square has also been a topic of conversation and some consternation. I reported in June that the main investors in the building are actually hundreds of pension funds, foundations, and endowments across the country. These institutional investors bought into a real-estate fund managed by a unit of Prudential Financial Inc. That fund, called PRISA, put up most of the equity for 11 Times Square.

As for that aquarium: Jerry Shefsky, the Canadian developer who confirmed his plans for the $100 million project in an interview with me Wednesday morning, says he’s been eyeing the site at 42nd Street and 8th Avenue for 10 years. He says he had discussed an aquarium with the site’s previous owner, the Milstein family. The Milsteins broke ground for a tower in 2002 but never built anything. Instead, the family sold the site to Prudential and Mr. Pozycki in 2002 for $332 million. Mr. Shefsky says he’s been discussing the aquarium with Mr. Pozycki for the last year and a half, and Mr. Pozycki himself mentioned the possibility of an aquarium in his building in an interview with The New York Times in October.

Mr. Shefsky now says he thinks the deal will finally happen. “After all these years, I’m pretty confident it’s going to go through,” he said. Among the planned amenities: a major entrance on 42nd Street, tanks filled with 600,000 gallons of water, a museum with authentic pirate artifacts, and a “biosphere” exhibit featuring real-time environmental data. Installing an aquarium inside a skyscraper rather than a big, low-slung property presents some challenges, of course, and it remains to be seen how tourists, who come to Times Square to see shows and go shopping, will take to an aquarium. “We have a multi-story property, so gallons aren’t as important as what we put in it and how educational and technology-driven we make it,” Mr. Shefsky said. “It will be a Times-Square, theatrical-type presentation.”

Mr. Pozycki and Prudential have declined to comment for this story. A Proskauer spokesman didn’t respond to requests for comment.